How Will My Neg. Credit Affect Getting Business Credit?
Let's just say my husband and I bit some big bullets in order to keep our children out of day care and for me to stay at home with them and start investing in REI. I formed my LLC earlier this year and have started receiving credit card offers in the mail. If I have bad credit, and apply for these, will it hurt my LLC's credit? I was wondering if no credit for my LLC was better than bad credit. And if there were other ways I could establish credit for my LLC.
Thanks!
[addsig]
I'm not real sure about establishing LLC's credit, but I do know that because your LLC is so new, the credit card company will base their decision on your personal credit. They did that for me when I got a business credit card in my LLC's name.
Call the business credit card company and speak with a representative - they will help you make an informed decision... You could probably get qualified for one even with bad credit - the limit will likely be very low, but it's a start.
Good Luck!
[addsig]
Hi, nice to see some fellow Georgians on here!
Your beginning LLC has no credit. For it to have credit, you have to guarantee it with your credit. Now, once it's been going for awhile, you can go get yourself a D&B number, get a few trade lines established, then you can think about getting credit established for your LLC, on it's strength only.
There's a good thread somewhere on this board telling how to do this, just do a search...
Matt - thanks. I'm totally fine with a low limit, I just want to start getting some credit established. That’s a good idea, I’ll call the credit card company. I don’t want to give my LLC bad credit right off the bat, I’d rather wait until my credit is stronger or try another avenue if it’ll spare my LLC.
I always love to see fellow Georgians too. 
I’ll check out D&B and I’ll do a search. Guess in the meantime I’ll get some more credit cards established.
Hi Jam200.
Thanks!!!
[addsig]
Lets assume that you get a credit card and you have a single individual LLC. Hence the tax ID is the same as the person who owns it.
You establish some credit with a credit card vendor. I believe the credit will show up on the credit report for the individual. At what stage does the credit actually show against the LLC?
Now assume that the LLC already has a D&B number but no trade accounts. I would expect the credit cards to still be of little help. I would think that only trade accounts that are reported against the D&B number will build a credit profile for the LLC. The profile being at D&B (and not a credit bureau).
As to getting a D&B number, you can do that for no charge by going to their website and requesting one. They will want to sell you a $500 product but they will issue you a number for the company without a purchase.
John
Quote:
On 2004-11-17 10:52, jam200 wrote:
Hi, nice to see some fellow Georgians on here!
Your beginning LLC has no credit. For it to have credit, you have to guarantee it with your credit. Now, once it's been going for awhile, you can go get yourself a D&B number, get a few trade lines established, then you can think about getting credit established for your LLC, on it's strength only.
There's a good thread somewhere on this board telling how to do this, just do a search...
[addsig]
I just applied for my D&B #, yay!
can you give me an official definition of "trade accounts"? Would those be accounts that are specifically related to my type of business, like REI and Home Depot?
Thank you,
Ginnie
[addsig]
I had a heck of a fight with D&B to get my number. The woman who called for the verification kept telling me the number was useless unless I paid $219 for them to establish a credit file.
When I got mine, I was told that I would not be able to get a "full report" produced for my business without paying the fee. However, the most important thing with D&B, which you will get for free regardless, is a paydex score. From 1-100, (70 being considered good) a score is issued once you have 5 accounts reporting on your for about 120 days. Try Viking Office Supply, they opened my account with no personal guarantee, and my new LLC was okay with them.